Lydia and Ellen own the LE Partnership. Lydia takes care of daily operations and receives...
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Accounting
Lydia and Ellen own the LE Partnership. Lydia takes care of daily operations and receives a guaranteed payment for her efforts. What amount and character of income will each partner report in each of the following independent situations? a) The LE Partnership has no ordinary income and reports a $100,000 short-term capital gain. Lydia receives a $40,000 guaranteed payment plus a 40% distributive share of all partnership income after deducting the guaranteed payment. b) The LE Partnership reports $160,000 of ordinary income before considering any guaranteed payment. Lydia receives 60% of partnership income but not less than $110,000.
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